Costing

Costing MCQs with Answers and Explanations | Cost Accounting Objective Questions

Sharpen your understanding of Costing and Cost Accounting with our collection of MCQs with answers and detailed explanations. Covering key topics such as marginal costing, standard costing, process costing, job order costing, variance analysis, budgeting, cost control, and managerial decision-making, these objective questions are highly useful for students, teachers, and candidates preparing for professional and competitive exams (CA, ACCA, ICMA, MBA, CSS, PMS, NTS, FPSC, PPSC, UPSC, etc.). Each question includes a clear solution and explanation to strengthen concepts, improve problem-solving skills, and enhance exam preparation. Perfect for practice, self-assessment, and revision in the field of Cost Accounting.

194. Blanket overhead rate is:

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One single overhead absorption rate for the whole factory
Rate which is blank or nil rate
rate in which multiple overhead rates are calculated for each production department, service department etc
Always a machine hour rate
✅ The correct answer is A.
Blanket overhead rate is one single overhead absorption rate for the whole factory. It is a common absorption rate used throughout a factory and for all jobs and units of output irrespective of the departments in which they were produced or processed. It is a one single overhead absorption rate for the whole of the factory.

196. Responsibility Centre can be categorised into:

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Cost Centres only
Profit Centres only
Investment Centres only
Cost Centres, Profit Centres and Investment Centres
✅ The correct answer is D.
Responsibility Centre can be categorised into Cost Centres, Profit Centres and Investment Centres. Responsibility centers are often categorized by the degree of authority and responsibility given to the manager.

198. Overhead can be classified according to function-wise as ________.

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fixed o/h, variable o/h and semi-variable o/h
controllable o/h and uncontrollable o/h
manufacturing o/h, administration o/h and selling & distribution o/h
past cost and future cost
✅ The correct answer is C.
Overhead can be classified according to function-wise as manufacturing o/h, administration o/h and selling & distribution o/h.

199. When two products are simultaneously produced in a process and one of them has comparatively high value and other is of low value , the low value product is called __________.

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joint products
by products
seasonal products
economic products
✅ The correct answer is B.
When two products are simultaneously produced in a process and one of them has comparatively high value and other is of low value , the low value product is called by products.

200. An assumption of specification analysis states: any observation does not belong to any other observation’s residual value, is classified as

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independence of residuals
dependence of residuals
independence of correlation
dependence of residuals
✅ The correct answer is A.
An assumption of specification analysis states: any observation does not belong to any other observation’s residual value, is classified as independence of residuals. These residual plots can be used to assess the quality of the regression.